I will be joining a PE firm this month as an associate on their investing team. Can anyone who’s made the switch comment on how I can best prepare for the transition? Study my new fund’s portcos, drill LBOs using some specific site, read certain investing books, etc.? Would prefer to keep this discussion to how I can put my best foot forward day 1 vs. how to prepare for interviews, as I already have the job.

likefunny
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Tape your eyes open, because you’re going to say goodbye to sleep

likefunnyuplifting

A few tips:

- ask if there is an LBO model template that the firm likes to use and try to get a copy. Trace through each cell and make sure you understand how it works. Think about clean ways to plug more complicated operating models into the template

- when you’re assigned portfolio companies, find the old investment committee decks and read them. Create a cheat sheet for each with key info (eg EBITDA, Capex, multiple paid, quantum of debt outstanding, CEO’s name)

- invest more time in formatting your excels. Depending on your firm, you may find that printed excels are the default way to share information (not slides like in consulting). That means clean formatting, standardized color coding, and clear labeling is a critical element

- as you ramp up, keep a running list of questions to ask your VP / direct manager in an organized manner. Could be acronyms, concepts (eg what’s a “step up” and why do we care), etc

- slow but accurate is way better than fast and unreliable. You’ll naturally get faster over time, but your team / committee is far more numbers-oriented than your consulting teams and math mistakes / numbers not tying is the fastest way to lose credibility as an associate

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Thanks, this is great! Some of this will be especially important given the virtual environment too

A few other thoughts:

- if you can (and if it’s “normal” at your firm), scan through IC materials when they’re distributed and listen into the IC meetings. At first it will be hard to follow (shared knowledge from previous conversations, industry standards, references to people) but over time you’ll learn a ton

- don’t try to learn everything about all of the firms portcos. You’ll learn enough over time through osmosis.

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Great response BCG1. Now I just need to get the job first 😅

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In the same boat, let me know what you end up going with!

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Did you not have to practice lbo modeling for your interview?

I did and was required to build a variety of models for interviews. It’s easy to forget the concepts if you don’t keep up with them and I received the job ~2 years ago, which is typical of PE on-cycle recruiting. For consultants, these models are also usually simplified and I plan to study the more difficult intricacies since I’ll need to know them on the job

likehelpful

Congrats!!!

This is great. Following for tech growth equity.

Same here actually

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